Insights

Samsung’s Pivot from Mobiles to Semiconductors

Samsung Mobile has lost its leadership position in the 3 biggest markets while the Semicon Business Unit has displayed hockey stick growth in RevenuesSamsung Semiconductor has a 52% operating margin and contributes to nearly 75% of the total operating profitSamsung generated more profit in 2017 than in 2016 + 2015 full years combined. This is a phenomenal growth story for Samsung Electronics as the bulk of the growth in the top and bottom lines is not driven by the mobile division but the semiconductor division. The was mainly caused by the shift to higher storage capacities (that started with Apple’s iPhone and was also adopted by Chinese brands) have kept the demand for Samsung memory parts at an all-time-high. Simultaneously, Samsung has lost its leadership position in the Indian, Chinese and American smartphone markets leading to declining revenues from the Mobile Communications BU.